It’s that time again for your monthly newsletter! Notice QR codes seem to be back? While I like QR codes and think they are handy I sure hope we all can “experience” some of the beautiful places the Pacific Northwest has to explore in person and soon!
I wanted to reach out to you today as I have been receiving many texts, calls and emails on how this outbreak maybe affecting the busy real estate season. This is a difficult time for all of us and the months ahead will bring uncertainty and challenges, of that, there is no doubt. This morning the owners of our five RE/MAX Elite offices had an online meeting with all of us to share the recent changes that the Northwest Multiple Listing Service (NWMLS) is advising based on social distancing, lowering the group threshold to 50 and best practices to protect our clients, ourselves and the public. We shared thoughts and ideas to keep working and helping our clients with their real estate needs but also to take action to keep everyone safe.
At the time the virus started to rear its ugly head there was a housing shortage. Meaning there were not enough homes for all the buyers that were currently looking. In the last month I have listed 3 homes with each one receiving multiple offers. The last home was two weeks ago, received double digit offers and a listing price that soared the final purchase to over $66,000 from listing price. That fact has not changed. We still are at low levels of inventory and in the last week I have seen homes come on the market and then sell in 3-5 days. I have three closing this week and while I know they are thankful, they are through the process, others are now very concerned what it may mean to them.
With that said in the last few days these are the most pressing questions I have been receiving regarding real estate. I hope I can shed a bit of light for you on what I know to be true currently.
What are interest rates, should I refinance?
Am I going to close on time?
Are open houses still going to be happening?
Should I wait to list or buy?
Sorry, this is long I will highlight the above question and try to answer the best I can with the information that is continually coming in.
Should I refinance now? I love how so many past clients and friends reach out to me with this question! While I am not a lender, I do try to read all the information coming in and what my preferred lenders are saying. When I am speaking to them I ask what they are seeing and what effects they are feeling. One of my preferred lenders, Duane Martin, at Caliber Home Loans indicated last week that they are inundated by those requesting refinancing. He mentioned that there may be a cap on refi’s right now and they may run out into 60 days to get completed. With so many wanting to refinance this is going to put a large strain on the lenders, title/escrow, appraisers and lending institutions. Home sales and purchase must be the priority.
So, to help answer questions, home mortgage interest rates did dip to a historically low rate and some were able to take advantage of this. They have since come back up to normal rates. This may change. They could go down again, rise or go higher. What you may be hearing more of right now are the interest rates for consumer debt being lowered. Another one of my lender colleagues, Jeff Tisdale from VIP Mortgage out of Tempe, AZ area states “The Fed Funds rate does NOT directly reflect in mortgage rates. The Fed rate impacts shorter term rates like credit cards, HELOCs, car loans, etc. Mortgage rates generally parallel the 10-year treasury bond. HOWEVER, there was a liquidity and volume issue due to the massive amounts of refinance volume, so rates spiked last week. We won’t know how this will affect mortgage rates until tomorrow and the coming days, weeks, etc. The industry can only take on so much at one time. Nobody truly knows what will happen, but I would expect continued volatility in the near future.
What is true is we are in uncharted territory and nobody knows what the short- or long-term effects of this will be.” Jeff goes on to say for anyone interested in refinancing or purchasing to get their application in with ALL supporting documents. The mortgage industry is beyond capacity right now and the complete files will get worked on first. The clients that need to be chased down for paperwork will suffer and wait.
Am I going to close on time? Our team has several clients that are scheduled to close the end of the month. Will we close on time? That is our goal. I am telling all of my clients that we are working behind the scenes to keep up with, and make sure, we work together quickly with Escrow/title your lender, insurance, mortgagor and all the other moving parts involved with a real estate transaction This is our goal! If we make sure all is in order beforehand and you are quick and diligent about getting any last-minute documentation requested into them we should. If, however, the county shuts down and there is no one to complete the transfer and recording process this very likely will delay homes closings.
There is that wish again for a crystal ball!
Are open houses still going to be happening? Well that changed very quickly. As of this morning they were advising to not have open houses but you could do one with limiting people through a few at a time, taking safety precautions and letting your seller decide based on if the home was vacant or occupied. After speaking with a seller this morning and coming up with a plan for them and their needs it has since changed. The NWMLS stated this afternoon they are disabling the Open House and Broker feature until the end of the month. What does this mean? Essentially no open houses. The consumer real estate sites are fed from the NWMLS. All the information on open houses regarding days, times, information and updates feed to sites like Zillow, Realtor.com, Redfin etc. If you go looking on Saturday morning for the open houses for the weekend you are not going to find any. I suppose there may be a rebel out there who puts up an open house sign in hopes that you are wandering aimlessly around and see their sign and say “Wow let’s go” but I doubt it.
Should I wait to list or buy? Of course, we have a huge concern for our clients many of whom we have been working with for months!
For sellers to get them to the point of selling its not always easy! If you have not sold a home you may not realize the time, energy, cost and all the prep work that goes into doing so. I have 2 sellers right now that I have been working with since September and one since August! We were going to be listing in April/May. So now what? We have some buyers and sellers that are moving on to their next adventure in life. Some are moving across country for jobs or family. Some are downsizing and some are looking for a different home to fit their family’s needs. There is so much thought that goes into buying or selling a home and our job is to direct them while keeping them moving forward to their goal. This service we provide to our clients prior to ever being compensated. Our advice, suggestions, referrals for contractors, lenders, timelines and helping them coordinate for their new home takes great thought, planning, experience and counseling. We want our clients to know that we will continue to do all we can to direct and guide them. If they have a job they have to be at here in Washington, or another state, then we move forward and help them buy or list their home when planned. If they are moving because they have a new home being built, and do not want 2 mortgages, or need to move to take care of a family member we move forward as planned the best way we can. For each client it’s going to be a different scenario.
When you’re selling a home exposure is key. The more potential buyers see your home and feel themselves living in it the more likely you will get an offer. If we are limited on showings, open houses, Brokers opens, advertising then it will affect the entire experience and days on market will be longer. That is a determination that each needs to make based on their future goals. If, by chance, your kids are now home with you and that idea of decluttering and packing while they were at school has now turned into home-schooling then well, we may have to re-adjust your goal.
For our buyers you may be looking on line but you need to see the home and feel how you would flow in it and make sure it meets your needs. This is very difficult to do without physically viewing and we want you to know that Britt and I will be available for private showings at this time, and as the needs arise, if the home allows it.
It will be okay and together we can do it! We need to go with the flow but flow we must. I feel the worst thing we can do is just freeze and not move forward. Yes, we may be hitting the pause button for a bit but, we must move forward.
Please remember during this time of uncertainty, I want you to know that we are thinking of you and will do whatever we can to support our clients and their goals. Yes, this outbreak is very scary, but we can’t let it dismantle our economy. Small businesses will suffer and there will be effects down the road that will affect us all. We need to be caring and do all we can to support/shop local.
Please don’t live in fear. Be smart, stay safe, stay healthy and keep in touch.
I would be happy to go into this deeper with anyone that has questions.
Feel free to reach out!
Jen Murrweiss and Britt Maltos
Welcome to 2020 and happy New Year! I hope it will be an amazing year for you and all of us! The infographic you see below is for Washington in a whole. If you would like to see local stats I am also providing you with the stats for Snohomish County and King County.
Ready or not the holiday season is here and jam packed with so many exciting things to do! Enjoy all Snohomish county and our Puget Sound region has to offer. Our favorite family tradition is to head up to Leavenworth to see the lighting of the town it’s just magical and this year is the 53rd Annual 2019 Christmas lighting. If you have time check it out.
The Snohomish County Homes Team.
REAL ESTATE news
Sales of existing homes slipped 0.7 percent in July, fourth straight monthly decline
Lower priced homes are experiencing fewer price reductions than upper end properties
Home value growth slowing in several hot markets
MORTGAGE & FINANCE news
Young homebuyers funding home down payment from their retirement account
Massive student debt makes homeownership almost impossible
Guide to understanding your home’s value
Declutter your kitchen and double your storage space
Questions to ask before buying a condo
Buyers see hope on the horizon in cooling Seattle market
Seattle-area drops to the #12 market for home price growth
Home price acceleration slows, but it’s still a challenge if you’re a buyer
Seattle #2 on list of best cities for ice cream lovers
Performing arts and affordable housing come together in planned Rainier Valley development
The SR-99 tunnel gets its stripes (and some running stick figures)
Port of Everett breaks ground on huge and historic modernization project
Where do Washington State’s billionaires live?
WEEKLY DOSE OF awesomeness
What do the smart home systems of the wealthy have that Alexa doesn’t?
(hint: Morgan Freeman)
The weather is ugly today so sitting here working on client files my mind started to wander to all the great things, activities and adventure that can be found in our great state and especially here in Snohomish County. So join me in checking out some ideas for fun stuff to do to either get out of the rain or have fun in it!
KIRKLAND, Washington (October 5, 2015) – Scarce inventory, new rules for mortgage closings and affordability concerns will likely slow home sales around Western Washington during the remaining months of 2015 and into early 2016, according to spokespersons from Northwest Multiple Listing Service.
The latest statistics from the MLS show a double-digit drop in inventory, a double-digit jump in closed sales, and a near double-digit increase in prices from a year ago, prompting one industry leader to say the trends aren’t sustainable. “We simply can’t sustain double-digit increases in sales when inventory levels continue to drop every month,” remarked OB Jacobi, president of Windermere Real Estate. “We’re on the cusp of a housing market slowdown,” he predicts.
Northwest MLS director Darin Stenvers also expects a slowdown, pointing to new rules for mortgage closings and rising interest rates as culprits.
“With the introduction of the new TRID(1) banking and closing disclosure requirements we will see longer closing timeframes for the foreseeable future. This will lead to a slowdown in closings and thus may slow the market until early or mid-2016,” explained Stenvers, the office managing broker at John L. Scott in Bellingham. Layoffs and the possibility of higher interest rates result in unpredictability for both buyers and sellers, he suggested.
Despite an expected slowdown, closed sales through the first nine months of this year are running 16.6 percent ahead of the same period a year ago, with median prices up 9.2 percent.
The MLS report for September shows pending sales continue to outnumber new listings, resulting in inventory declines in most of the 23 counties in its service area. That imbalance leads to rising prices.
Northwest MLS members reported 9,574 pending sales (mutually accepted offers) in September for a 7.9 percent increase from the year-ago figure of 8,875. Compared to August, pending sales fell 9.7 percent.
Closed sales jumped 17.5 percent, with year-over-year sales rising from 7,020 finished transactions to 8,245. Twenty of the 23 counties reported double-digit gains from a year ago.
Prices showed more variation. Area-wide, the median price on last month’s closed sales of single family homes and condos was $312,000. That’s up nearly 9.5 percent from the year-ago figure of $285,000, but down slightly from August.
Compared to the system-wide gain, prices rose at more modest rates in three of the four counties in the Puget Sound region, with Pierce County being the exception. Year-over-year prices there jumped 11 percent. Prices in Kitsap County were up only 4 percent from a year ago; in King County the gain was about 4.8 percent and in Snohomish County it was about 7.5 percent.
Single family home prices across the 23 counties in the MLS report rose nearly 7.6 percent from a year ago, from $297,500 to $320,000. Single family homes in King County commanded the highest median price at $490,250, up 6.6 percent from the year-ago figure of $460,000, but down from June’s high of $500,000.
The condo market remained hot with both sales and prices up by double digits. Members reported 1,183 closed sales during September for a gain of nearly 30 percent from a year ago. Prices on last month’s sales jumped 13 percent, from $230,000 to $260,000.
“We’re coming off one of the hottest summer housing markets on record, and the second-best September on record for sales activity in the four-county area,” said J. Lennox Scott, chairman and CEO of John L. Scott. He attributes part of the surge to an interest rates drop in May, and the anticipation of rates increasing in the near future.
Dwindling inventory continues to be a drag on activity, but some brokers believe new construction activity is encouraging. Stenvers said new housing starts could help boost inventory in many markets during the coming months.
For now, new listings are drawing “quick action” when they come on the market, said Scott, adding, “We are virtually sold out of inventory.”
MLS members added 8,772 new listings during September, down slightly from the year ago total of 8,878. At month end, there were 19,724 active listings in the database, down 23.3 percent from the same time a year ago when inventory totaled 25,717 properties.
“We’re selling everything before buyers can turn around,” commented Dick Beeson, principal managing broker at RE/MAX Professionals in Tacoma and a member of the Northwest MLS board of directors. Figures showing the ratio of listings to sales, known as months of supply, tend to support his belief.
For September, the MLS reported 2.39 months of supply system-wide, about the same as the figure for August. The shortages were most acute in King County, with about 1.4 months of supply, and Snohomish County, with about 1.9 months of supply. Industry experts use a range of four-to-six months as an indicator of a balanced market.
“The frenzied market on the Seattle side is taking a toll on Kitsap home prices,” said MLS chairman Frank Wilson, the branch managing broker at John L. Scott in Poulsbo. Prices there rose 4 percent from a year ago. He reported good traffic at open houses in Kitsap County, quick acting buyers when a new listing appears, many multiple offer situations, and an increase in investor interest.
“Since new listings coming to market usually slow during the fourth quarter, we are looking at a severe shortage of inventory heading in to the spring market of 2016,” Wilson remarked. Like others on the MLS board, he said serious buyers need to be prepared to take immediate action when they find a home they like.
“In preparation, buyers need to meet with a lender, find an inspector, check with their insurance agent, and get their financial house in order so they can move aggressively,” Wilson advised.
Scott said house-hunters who procrastinate may be disappointed. “If you’re looking for a home this winter, the number of listings coming on the market each month will drop approximately 50 percent every 30 days compared to spring and summer months,” he predicts.
Brokers say opportunities still exist for buyers who have missed out on homes during multiple offer situations.
Some buyers who are weary of bidding wars are looking in areas where multiple offers are less common, said MLS director George Moorhead. Also, buyers who consider homes that have been on the market more than 120 days are negotiating much better terms without the competition of other buyers,” he reported.
Scott also recommended alternatives for frustrated buyers. “There are still opportunities to take advantage of low interest rates by taking a second look at homes that have been on the market for more than a month. If you don’t mind doing some fix up, you can negotiate the price and avoid multiple offer scenarios,” he stated.
Beeson suggested inventory shortages could be eased if expired listings are re-listed. Not every home sells once it’s listed, he noted. His analysis shows more than 2,600 listings have expired in the tri-county area so far this year. “These are sellers who need coaching on pricing,” he believes.
Even though they’ll face longer commutes, Moorhead said buyers who are feeling squeezed by the lack of inventory are extending their search areas farther than before in hopes of finding a home at an affordable price. These buyers hope to sell the home in the outlying area within five years and purchase another home closer in. “This calculated move hasn’t really been a conversation in the past,” said Moorhead, the designated broker and owner at Bentley Properties in Bothell.
Bobbie Chipman, principal managing broker at John L. Scott’s Puyallup office, said statistics strongly indicate buyers must be strategic in the current market in order to be successful. “If buyers have a home to sell in order to purchase, they should consider selling, then prepare to live in temporary housing while looking for the right home to purchase,” she suggested.
Buyers without a home to sell may be better positioned to have their offer accepted, believes Chipman, a member of the Northwest MLS board of directors. “These buyers should look at both active status listings and contingent listings to expand their choices,” she explained.
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 23,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 23 counties in Washington state.
(1) TRID is the TILA RESPA Integrated Disclosure rule that became effective 10/3/15. New forms are required for any transaction involving a mortgage. See: TRID.
Statistical Summary By Counties
Market Activity Summary and 4-County Puget Sound Region Pending Sales (PDF)
This information provided by the NWMLS.